Colorado to receive $4.5M in settlement with GlaxoSmithKline

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Pharmaceutical manufacturer GlaxoSmithKline agreed to pay $3 billion to settle government charges that it illegally promoted and priced several popular prescription drugs, the U.S. Justice Department said Monday.

The settlement of criminal and civil cases against GSK is the largest in U.S. history and the largest payment ever by a drug company. Colorado, where some of GSK’s violations came to light, stands to receive more than $4.5 million from the company, the state Attorney General’s office said.

As part of the settlement of the criminal case, GSK pleaded guilty to unlawful promotion, false price reporting practices and its failure to report certain safety data. The company will pay a criminal fine of $956 million and forfeiture of $43 million.

The manufacturer also will pay $2 billion to resolve its civil liabilities with the federal government.

The government alleged that GSK marketed drugs Paxil, Wellbutrin, Advair, Lamictal and Zofran for off-label uses and made false representations regarding the safety and efficacy of those drugs as well as diabetes drug Avandia.

The case also alleged the company provided incorrect pricing data and offered kickbacks to health-care professionals to promote its drugs.

The government said the company’s improper marketing included providing doctors with expensive resort vacations, European hunting trips, high-paid speaking tours and tickets to a Madonna concert.

In Colorado the company provided doctors with ski trips to Breckenridge, Colorado Avalanche hockey tickets, free samples of the drugs to prescribe, and money to speak at conferences, court documents detailed.

Two Front Range-based sales representatives at GSK were fired after notifying management of the illegal practices taking place in Colorado. The two objected to activities such as providing food, drink and entertainment to physicians as bribes, according to court documents.

No doctor involved is facing criminal charges.

The $2 billion settlement will compensate losses suffered by numerous government health-care programs, including Medicare, Tricare, Veterans’ Affairs and Medicaid.

Colorado’s payment represents the losses specifically attributable to Colorado’s Medicaid program. The State of Colorado pays roughly $5 billion each year for the medical care of 700,000 qualified recipients, the state attorney general’s office said.

The offices of attorney general John Suthers and John Walsh, U.S. attorney for Colorado, were involved in the investigation and resolution.